Business relationship management is a framework that strategically nurtures positive relationships to achieve three capabilities: driving value, building partnerships and evolving culture. In part two of this series, we’ll explain how BRM as a capability and business relationship managers as a role drive value.
In part two of this four-part series, we covered the basics of business relationship management and described how this framework acts as a capability, discipline and role to evolve culture, build partnerships, drive value and satisfy purpose. In this article, we’ll break down how the role of a business relationship manager applies the capability to identify and deliver value within your organization – and why doing so is important.
The Role of Shared Ownership
To thrive in today’s business landscape, leaders must foster a culture of workplace transparency and shared ownership of business outcomes. You can achieve this by driving organizational change at the cultural level, where supporting disciplines, capabilities and roles converge. By establishing a culture of shared ownership, your organization can realize measurable value, leading to improved speed and quality of service delivery, ultimately bolstering the bottom line.
The business relationship manager (BRM) plays a pivotal role in identifying, tracking and optimizing value generation throughout the entire end-to-end lifecycle. They are responsible for overseeing the creation of value plans and ensuring the effective execution of initiatives and projects to generate tangible value.
A value plan is a document that identifies how your organization will create and monitor value when pursuing an idea or opportunity. You should base value documentation on identifying the key value drivers and their measurable impact on specific outcomes.
What Drives Value Generation?
According to The Business Relationship Management Institute, we can divide and classify value generation into the following three areas.
1. Operational Value
Maintaining smooth and secure organizational operations is essential, even though their value may not be immediately apparent. However, when operations falter, such as a website downtime or a security breach, their significance becomes evident. One effective way to demonstrate their value is by highlighting the negative impact that would occur in the event of operational failure.
To achieve this objective, the BRM can partner with members of the business continuity team to leverage available data to identify the financial, security and reputational impacts of service or product disruption. To determine availability patterns, they can obtain monthly service and product availability reports from the network operations center or service desk providers.
By comparing both data sets, the BRM can proactively report on achieved value and identify opportunities to increase operational value through continual improvement.
2. Continuous Improvement
You can also derive value from the continuous improvement of existing capabilities. Over time, these capabilities may lose their initial value, prompting the need to revisit and identify areas for enhancement, which can greatly benefit the organization.
You can achieve such improvements by reducing costs, streamlining processes, enhancing data for decision-making or optimizing staff efficiency to save time. For instance, automating non-essential tasks in the onboarding and offboarding employee procedure can generate value by saving time, minimizing errors and enhancing the experience for both leadership and employees.
Innovation is crucial for organizations to stay ahead of the competition and remain relevant in an ever-changing landscape. However, it is often an organization’s most challenging and overlooked aspect. Embracing innovation requires a willingness to envision new possibilities and a mindset open to change. It may involve a cultural shift and the recognition that the risk of failure is high, but the potential rewards of achieving something truly innovative can be game-changing.
Innovation doesn’t always require a massive transformation or groundbreaking invention. You can find it in smaller initiatives, such as exploring new ways to engage with partners for an enhanced experience. Realizing the value of innovation requires identifying the right ideas to pursue. Importantly, it also acknowledges that learning from failures can be valuable to the innovation process.
Creating Business Value Through BRM
While the business relationship management capability doesn’t directly own value creation, its role is to orchestrate relationships that generate results aligned with the organization’s value needs over time. As a role, BRM aspires to cultivate a culture of shared ownership, engaging all levels of your organization in upholding dedicated standards that promote consistent and modeled approaches to work delivery is essential.
These individuals collaborate to develop strategies, collectively take ownership of results and work as a team to enhance business value. You can accomplish this by consistently performing the following activities:
Value discovery is a vital activity within the BRM capability and closely intertwines with demand shaping. It entails understanding the overall organizational strategy and its maturity to explore ideas and uncover their inherent value. Through collaborative efforts with partners, the BRM leader achieves clarity and focus on prioritizing ideas with the potential for genuine competitive advantage. At this stage, you decide to either transition the idea into a value plan or set it aside for future consideration.
For example, in a service-based industry, such as hospitality or retail, the BRM capability can focus on discovering value by improving the customer experience. By understanding the organizational strategy and working collaboratively with partners, the BRM can identify ideas to enhance customer satisfaction and loyalty and differentiate the organization from competitors. They can then prioritize and transform selected ideas into value plans to execute.
The BRM can help establish a value plan that identifies the value drivers (e.g., growth, financial gains or efficiency) associated with the idea and also provides a time frame for the organization’s realization. For each defined driver, the plan also outlines the requirements for reporting schedules, required partners, length of measurement, key performance indicators and data sources. Once agreed upon between the BRM and their business partner, the value plan is inserted into the business case. If the organization approves the business case, the value plan is inserted into the program or project plan, which is managed as a deliverable.
For example, in a technology company undergoing a digital transformation, the BRM can play a role in establishing a value plan for the project. The plan outlines gained efficiency targets and value driver goals. It specifies reporting schedules, required partners, key performance indicators and data sources to measure the efficiency gains achieved through the digital transformation initiatives.
The business relationship manager plays a critical role in assessing whether your organization realizes the intended value. As such, the role is responsible for demonstrating the impact of value drivers by measuring their effectiveness and reporting on the achieved results. This ensures ownership of benefit realization and continual improvement activities.
For example, the BRM can play a critical role in evaluating the effectiveness of marketing campaigns. By measuring the impact of value drivers, such as customer acquisition, brand awareness or revenue growth, the BRM can assess whether the company realized the intended value. They can analyze key performance indicators (KPIs), track campaign results, and report on the achieved outcomes to ensure ownership of benefit realization and identify areas for continual improvement.
Continuous improvement should be the norm after deploying a solution. The business relationship manager plays a key role in optimization by bringing the right people together at the right time to determine opportunities to optimize the new solution or way of working. By connecting the dots, the role of the business relationship manager ensures the team accomplishes – and doesn’t overlook – the work.
For example, in project management, the BRM can assist in optimizing project delivery and team collaboration. By bringing together project stakeholders, team members and project managers, the BRM can identify bottlenecks, streamline communication channels and propose process improvements. The BRM’s role in connecting the dots and ensuring effective collaboration helps optimize project execution, minimize delays and improve overall project management efficiency.
When they consistently apply this end-to-end process, the business relationship manager can establish continuity between strategic vision and driving value generation. You can better promote success and innovation by allowing all parties to look more aggressively at what’s possible through at-scale cost reductions and recommend broader, transformational shifts in productivity to accelerate growth, such as adopting agile techniques.
Driving Value Through Cultural Awareness
Trusted relationships, organizational knowledge and awareness of strategic objectives put the business relationship manager in an optimal position to facilitate and drive discussions around value. To become a culture that understands and works together in driving value, you must build a foundation on the following steps.
Sharing an understanding of the difference between value and benefits:
It is important to remember value is not the same as benefits, as benefits typically relate to project management. In its simplest form, the value of the solution equals the benefits of the solution minus the cost of the solution.
Understanding the difference between value and benefits is essential when conducting a cost-benefit analysis. For instance, a government agency evaluating infrastructure projects needs to consider both the benefits, such as improved transportation, reduced congestion or economic growth, and the overall value to society, such as increased productivity, environmental sustainability or social equity. By accurately assessing the value and benefits, the agency can prioritize projects that provide the highest overall value to the community.
Appreciating tangible and intangible value opportunities:
Intangible value is not physical (efficiency gains, customer experience), whereas tangible value is physical (return on investments). Often, businesses place the realization of tangible opportunities as their primary focus and overlook opportunities to measure gains in productivity and the impact of improved customer experience.
Many organizations emphasize tangible value opportunities related to financial gains and efficiency improvements. However, by recognizing the importance of intangible value, businesses can prioritize employee productivity and well-being. This can include flexible work arrangements, employee recognition programs or wellness initiatives.
By investing in employee satisfaction and creating a positive work environment, the BRM role can play a significant role in realizing intangible value through increased employee engagement, reduced turnover and improved overall organizational performance.
Making intangible opportunities through tangible, quantifiable measurements:
To remove the negative bias of intangible opportunities, determine if the opportunity can increase speed and quality or reduce cost. If the answer is yes to one or all of those considerations, your organization is in a prime position to define quantifiable, value-based measurements.
Companies can evaluate intangible opportunities in innovation and new product development using tangible measurements. For example, the BRM role can track metrics such as the number of new products launched, revenue generated from new products or market share gained through innovation. These quantifiable measurements demonstrate the value and success of the intangible opportunity to drive innovation and develop new products.
These are areas where BRM as a role contributes to value generation. However, their success depends on building positive relationships with their business partners. In the next installment of this series, we’ll cover how to develop your BRM capability to grow individual relationships into productive partnerships based on the organization’s strategic purpose.